Second

Session, 45th General Assembly

Elizabeth II, 2005

BILL 49

AN ACT TO AMEND THE

INSURANCE COMPANIES TAX ACT

Received and Read the First Time ...................................................................................................

Second Reading .................................................................................................................................

Committee ............................................................................................................................................

Third Reading .....................................................................................................................................

Royal Assent ......................................................................................................................................

HONOURABLE

LOYOLA SULLIVAN

Minister

of Finance and President of Treasury Board

Ordered

to be printed by the Honourable House of Assembly

EXPLANATORY NOTES

Clause 1 of the Bill would amend

section 4 of the Insurance Companies Tax

Act to provide for the payment of tax owed under the Act in monthly

instalments.

Clause 2 of the Bill would change a

reference to subsection 4(1) of the Act to a reference to

section 4 as a whole.

Clause 3 of the Bill would repeal and

replace

section 14 of the Act with the proposed sections 14 and 14.1.

Section 14 would allow a first appeal of an

assessment to the minister and under

section 14.1, an appeal of the minister's

decision could be made to the Trial Division. Presently, under

section 14 there is an appeal

to the Trial Division only.

Clause 4 of the Bill would change a

reference from

section 14 of the Act to

section 14.1. This change is required as a result of the

amendments referred to in clause 3.

Clause 5 of the Bill would add

paragraphs (

e) to (e.3) to the Act respecting the filing of tax returns to the

regulation making authority of

section 17.1 of the Act.

Clause 6 of the Bill would repeal and

replace

section 25 of the Act to increase the fine under the Act for failure to

pay a tax.

A BILL

AN ACT TO AMEND THE INSURANCE COMPANIES TAX

ACT

Analysis

S.4 Amdt.

Returns and payment

S.8 Amdt.

Payment of tax with return

S.14 R&S

14. Review by minister

14.1 Appeal to Trial

Division

S.15 Amdt.

Court of Appeal

S.17.1 Amdt.

Regulations

S.25 R&S

Failure to pay tax or file returns

Be it enacted by the Lieutenant-Governor and

House of Assembly in Legislative Session convened, as follows:

RSNL1990 cI-11

as amended

1. Subsection 4(1) of the Insurance Companies Tax Act is repealed and the following

substituted:

Returns and payment

(1) A

company that is liable to pay tax shall, before March 21 in each year and

without notice or demand by the minister, send to the minister in the form

required by him or her,

(

a) a return which shows the amount of tax payable

by the company for the preceding year; and

(

b) the tax payable for the preceding year, less

the amount of payment made under subsection (1.1).

(1.1) A company that is liable to pay tax shall pay

to the minister on, or before the twentieth day of each month of the year, an

instalment payment that is equal to 1/12 of the tax payable as estimated by the

company.

(1.2) A company that is liable to pay tax shall file

with the minister, along with the return and tax payment required under subsections

(1) and (1.1), the information that the minister considers necessary.

2. Subsection 8(1) of the Act is amended by

deleting the word and figures "subsection 4(1)" and substituting the

word and figure "section 4".

Section 14 of the Act is repealed and the

following substituted:

Review by

minister

(1) A

company that objects to the amount of an assessment made under this Act or

considers that it is not liable for tax imposed upon it may directly, or by its

agent, within 90 days after receiving the notice of the assessment of liability

for tax, serve a notice of review upon the minister.

(2) A notice of review served under subsection

(1) shall be in writing and shall set out clearly the reasons for the review and

the facts related to the review.

(3) Upon receipt of a notice served under

subsection (1), the minister shall conduct a review and may affirm, rescind or

amend the assessment and shall send by registered mail to the company or serve

upon the company notice of his or her decision.

Appeal to Trial

Division

14.1

(1) Where

a company is dissatisfied with the decision of the minister given under

section

14, the company may appeal from that decision to the Trial Division.

(2) An appeal under subsection (1) shall be made

by filing in the Trial Division, within 60 days after the date on which the

notice of the decision was sent by registered mail or served under subsection

14(3), or a further period that a judge of the Trial Division may on

application allow, a statement of claim naming the Crown as the defendant and

setting out the grounds of the appeal.

(3) Upon a statement of claim being filed under

subsection (2), the proceeding shall continue in the same manner as other

proceedings in the Trial Division unless the court orders otherwise, and a

party to the proceeding may apply to a judge of the Trial Division for

directions as to the conduct of or steps to be taken in the proceeding and a

judge of the Trial Division may make the order that he or she thinks advisable

respecting the conduct of the proceeding and steps to be taken.

(4) Upon an appeal under this section, the Trial

Division may affirm, set aside or vary the decision appealed and may, in

delivering a judgment disposing of the appeal, order payment or repayment of

the tax, interest and penalties, or costs, by the company or the government of

the province.

Section 15 of the Act is amended by deleting

the number "14" wherever it occurs and substituting the number "14.1".

Section 17.1 of the Act is amended by deleting

paragraph (

e) and substituting the following:

(

e) respecting the manner in which returns are to

be filed;

(e.1) respecting a variation in the time of filing a

return and the criteria required for a varied time of filing;

(e.2) respecting the forms of returns and the

information required with a return;

(e.3) respecting reviews of disputed assessments and

liability for tax by the minister; and

Section 25 of the Act is repealed and the

following substituted:

Failure to pay

tax or file returns

(1) A

company that fails to pay a tax or part of a tax in accordance with

section 3

or 8 or to file a return or make a payment in accordance with

section 4 or 5

within the required time may be liable, regardless of whether the company is

prosecuted or convicted under this Act, to a fine to be assessed by the

minister

(

a) not exceeding $100 for each day during which

the failure continued; or

(

b) of 10% of the tax that is unpaid,

and a fine under this subsection shall be

considered to be and may be collected as tax payable under this Act.

(2) The minister is not bound by a return or

information supplied by or on behalf of a company and the minister may,

notwithstanding a return or information supplied by the company, or where a

return has not been sent to the minister as required, make the assessment contemplated

under this Act.

Earl G. Tucker, Queen's Printer